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Fed Now Sees Only 0.2% GDP Growth In Q1
From almost 2.5% GDP growth expectations in February, The Atlanta Fed's GDPNow model has now collapsed its estimates of Q1 GDP growth to just 0.2% - plunging from +1.4% just 2 weeks ago. The reality of plunging capex and no decoupling is starting to rear its ugly head in the hard data and as the sun warms things up, weather will start to lose its ability to sway sentiment. While sell-side consensus has dropped (Goldman, Morgan Stanley, and Barclays all cut today following Durable goods), it remains unable to quite accept the reality of massively weaker than expected macro data evident everywhere (except in the soft-survey PMI data).
March 3rd... +1.2%
March 12th... cut in half to +0.6%
March 18th... another 50% cut in growth to a mere +0.3%
And now.. March 25th... Q1 GDP growth forecast drops to just +0.2%
On the bright side - at least he still has a job and hasn't been moved to more important things.
As The Atlanta Fed explains...
The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2015 was 0.2 percent on March 25, down from 0.3 percent on March 17.
Following this morning's advance report on durable goods manufacturing from the U.S. Census Bureau, the nowcasts for real equipment investment and real inventory investment declined slightly.
And that decline is only getting started...
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Cold out. Can't order online when cold out.
MUST.....click.....on......"Buy" butt...tt.............nuh, nuh..........
No worries, by the time we get the Q3 reports these'll be the good old days.....
They just have to manage the numbers a little. If Q1 is 0.1%, Q2 is -9.0%, and Q3 is 0.1%, voici, no recession.
Oh, wow, 0.2%!! It's so great that we have all those immigrants flooding over the border to help us consume all this added production!!
Is there a black box on this flight?
Prayer rugs.
Time to raise rates.
Sure, you try to get out of the hole the Fed dug and then tell me there aint hell to pay.
I would think that based on where the FED members head's usually are, the only thing they would be able to see is the descending colon.
wall street sees epic bonuses on more ZERO RATE MONEY! Market jumps!
#4U9525 Germanwings
contradicting blackbox news
NYT: Investigators said they had so far been unable to retrieve any data from the plane’s cockpit voice recorder, and the inquiry has been hampered further, an official said, by the discovery that the second black box, which was found on Wednesday, was severely damaged, and its memory card dislodged and missing.
latetest:
http://tersee.com/#!q=germanwings&t=text
In an economic system that has fully adopted "mark to model" (i.e. mark to fantasy) accounting standards does any of this really matter? Add to that the fact that credit/money creation has not required any real collateral since 1971 and the fact that the cost for money creation has been set at zero for 6+ years now (ZIRP)?
where the fuck does everyone think this is heading, or do we all believe that there really isn't any counterparty risk in the world today?
Agree with you 100%, in normal market the interest levels are directly correlated with risk. The higher the risk the interest rates, i.e. risk dictates interest rates. However in this fantasy world, finance practitioners have been duped into thinking that since rates are low then risk must be low as well, forgetting that it is risk that dictates interest rates and not interest rates that dictate risk. Hence, the complacency, however when negative events start coming their way hot and heavy, as it is happening now, people start to slowly realize their mistakes and then BOOM! We are in the slow realization phase right now. The minor boom will happen in the next month or so and the real BOOM will happen in Sept/Oct.
The higher the risk the higher the interest rates*
Given the idiocracy of people and government I am betting that everything will simply be "awesome" right up to and including the day you go to the grocery store and the shelves are bare...
many eastern societies have been through this many times...
Most people do not understand the basic truth that debt always involves risk. This is how Kyle Bass makes money. Finding places where the risk is much higher than the interest rate is placed. As he said, he wouldn't sell anything at 10 basis points.
As many of us who used to short things learned, in the event of the "big one", good fucking luck to Mr. Bass trying to collect on those bets. Let's be honest, that's all they are.
It helps if you are in the club. At least, that's what I've heard because I'm obviously not in it.
it simply proves that throughout the known universe, the hubris of humanity in association with it's stupidity is the highest seen, ever. and if we are all that is out there...what an epic failure on God's part.
So this is the most importantest 'fabricated' number of all time... It's even more important than the last importantest 'fabricated' number & should therefore be trusted...
Somewhere ~ a 17 yo hedge fund manager is adjusting his clients portfolios accordingly...
Nooo!!! Say it ain't so! Jews say we're not getting the growth they printed?
They would get 0.0 outa me if I had my way
This number comes into play before the elections...not now....
I doubt they can fine tune that much, unless they turn off the algos.
It's always before an election to a politician.
Time to start including hookers and blow
Print moar bitchez! Works every time..... Lol
"From almost 2.5% GDP growth expectations in February, The Atlanta Fed's GDPNow model has now collapsed its estimates of Q1 GDP growth to just 0.2% "
RED HOT RECOVERY!!! RAISE RATES NOW!!!
NOW!!! -BEFORE LABOR GETS ANY STUPID IDEAS ABOUT RAISES!!!
" Robust! "
0.2 is less than the error band, even after revision.
And I assume is NOT adjusted for inflation, which is easily 0.2% per quarter.
So, REAL growth seems negative.
Of course, even that can be an artifact of cheaper oil, the oil revenues are already lower but the benefit to industrial consumers will take another quarter to make it through the system. If that's right, look for an upside surprise next quarter.
I'm totally shocked by the Atlanta fed's unexpected revision!
Just wait for the next one.
According to The Office of Financial Research (OFR):
http://financialresearch.gov/briefs/files/OFRbr-2015-02-quicksilver-markets.pdf
March 17, 2015
Quicksilver Markets
by Ted Berg
One of the missions of the Office of Financial Research is to analyze asset market valuations and if there are excesses, explore the potential financial stability ramifications of a sharp correction. The author argues that U.S. stock prices today appear high by historical standards. Although he notes that the financial stability implications of a market correction could be moderate due to limited liquidity transformation in equity markets, he addresses other financial stability issues that may be more relevant, such as leverage, compressed pricing of risk, interconnectedness, and complexity.
Option-implied volatility is quite low today, but markets can change rapidly and unpredictably, a phenomenondescribed here as “quicksilver markets.” The volatility spikes in late 2014 and early 2015 may foreshadow more turbulent times ahead. Although no one can predict the timing of market shocks, we can identify periods when asset prices appear abnor-mally high, and we can address the potential implications for financial stability.
The bull market achieved an important milestone in March: its six-year anniversary. From the market bottom in March 2009 through the end of 2014, U.S. equity prices tripled. This gain has been largely driven by the recovery in corporate earnings, which have increased by a similar magnitude over this period. Although the positive trend could continue, the upturn has persisted much longer and prices have risen much higher than most historical bull markets, despite a weaker-than-normal macroeconomic recovery (see Figure 1).
This bull market has also benefited from unusually low interest rates. Some argue that the market’s price-to-earnings (PE) ratio is justifiably higher than the historical average given that interest rates are at historic lows. After all, the intrinsic value of a stock is the present value of its discounted future cash flows. And interest rates are a key factor in determining the discount rate. The lower the discount rate, the higher a stock’s present value. However, the relationship between interest rates and stock prices is more complex; a lower interest rate environment may portend a lower long-term growth rate for corporate earnings and cash flows. When estimating intrinsic value, it is naïve to simply reduce the estimated discount rate without also considering the potential adverse consequences for the growth rate of cash flows.
Many expect the Federal Reserve to begin increasing short-term rates later this year. This will have important implications for stock prices if longer-term rates begin to increase as well. Under one scenario, a slow and gradual increase in long-term rates would be bullish, reflecting investors’ positive expectations for higher U.S. economic and corporate earnings growth. In an alternative scenario, however, interest rates would increase dramatically and unexpectedly, which would adversely affect stock prices.
In light of this interest rate backdrop, the question is whether stock prices have run too far ahead of fundamentals. Although certain traditional valuation metrics, such as the market’s forward PE ratio, do not appear alarmingly high relative to historical averages, other metrics to be discussed — the cyclically adjusted PE ratio (“CAPE”), the Q-ratio, and the Buffett Indicator — are nearing extreme levels, defined as two standard deviations (or two-sigma) above historical means.1
Historically, periods of extreme valuations are eventually followed by large market price declines, some of which have contributed to systemic crises. On the other hand, extreme valuations have been known to persist for extended periods. For example, in a December 1996 speech, former Federal Reserve Chairman Alan Greenspan famously used the phrase “irrational exuberance” to describe investor enthusiasm for stocks. At that time, the forward PE ratio — the ratio of the market price to analysts’ consensus earnings forecasts for the next 12 months — was approximately 16 times. Although this was above the historical average, it was not alarmingly high. However, the CAPE ratio was much higher at 28 times. The S&P 500 more than doubled over the next three years, with valuations reaching all-time highs in March 2000, driven by the boom in technology stocks. The tech bubble eventually burst; the S&P 500 index decreased almost 50 percent and the tech-heavy Nasdaq index dropped nearly 80 percent from peak to trough.
LOL!! Intesting, tell me, historically speaking what does the total debt outstanding look like again?
What percentage of the GDP is now simply bullshit paper pushing?
MUST BE BULLISH
Replenishing stock buy back programs until it no longer works. Weasel a few more idiots before the bear market returns.
You'll never see another Bear Market.
...before the collapse anyhow...
This market don't need no stinkin' data.
GPD is for losers. Onward! Forward! To Zimbabwe heights!
....wadda ya mean down a percentage...fix dat glitch...
This market don't need no stinkin' data.
GPD is for losers. Onward! Forward! To Zimbabwe heights!
....wadda ya mean down a percentage...fix dat glitch...
If only we had lower interest rates. Oh Wait...a squirrel......Can't wait till they pay us to take out a loan.....already making us pay to keep our money. Everything is Awesome Bitchez!
0.2% reported....and we all know it means much much worse
Two tenths is a rounding error.
Hope and change!
Ready for Hitlery!
Since that's annualized actual forecast for the quarter is 0.05%
Where do they get these numbers???
recession in us since new years well known among the cognoscenti hope it's not to big a word for you zhers touches on 2 points first most zh stuff is stupid 2nd so why do i read zh because main stream media has reported remarkble growth during this recession
.2 % GDP Growth really means signficant contraction.
SNAP DEPRESSION in 2015 mid-year. People finally figured it out. Demand collapsing.
"GDP" and "The Rule of Law".
Made up and redefined on the regular.
The DOW should go up 1000 points when the news hits.
Not to worry....BTFD....
The Federal Reserve has given the US the royal screw.
This also brought down the economy in China and the other Asian producing countries after which, the countries that produce raw materials like Australia and Canada got affected.
And with the downfall of China’s producing power house the economy came down and that rounds the circle so now what next? …
Don’t even think of the Q-word. Oh No … here we go again ... shouldn’t have mentioned it WHERE’S THERE A CRASH? WORLD ECONOMY COLLAPSING!!! - HEADLINES MARCH 2015